Former Dartmouth College official admits embezzling from Vermont, New Hampshire nonprofits

Apr. 25, 2012

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Federal prosecutors and the lawyer for the former chief financial auditor at Dartmouth College soon will begin sparring over how much money he stole from several not-for-profit organizations in Vermont and New Hampshire.

The government maintains Bruce D. McAllister, 79, of Thetford was involved in “misappropriating hundreds of thousands of dollars” for groups in both states. The defense says the amount is not that high.

McAllister pleaded guilty Wednesday in U.S. District Court in Burlington to a single felony charge of wire fraud. The wire fraud involved the Alpha Theta House Corp., a co-ed fraternity at Dartmouth College, and the Meccawe Club, a private 900-acre trout-fishing club in Bridgewater.

Assistant U.S. Attorney Greg Waples said McAllister, who had served as a treasurer for several recreational and fraternal groups, began siphoning funds at least in the mid 1980s and continued for about 25 years. Waples said the lack of earlier financial records made it unclear when the crime began.

McAllister’s attorney, George Ostler, said in court that although his client admits all the elements of the wire fraud and believes the government could prove them at trial, there is some dispute involving the precise amount and length of the misappropriation.

Judge Williams Sessions III did not try to resolve the dollar amount Wednesday, but the matter could come up before sentencing, set for Sept. 24.

Ostler said after the 16-minute change-of-plea hearing that the defense hopes to show the dollar amount involved is not as much as the government claims. He said accountants are working on the case for the defense.

McAllister faces up to 20 years in prison, a fine of $250,000, a full restitution order and up to three years of supervised release.

Under the plea agreement, McAllister will receive credit for accepting responsibility and will be sentenced at the low end of the federal sentencing guidelines. He also won’t be prosecuted for other possible crimes known as of Wednesday.

Waples told the court that McAllister had been found mentally fit following a recent, private competency examination.

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McAllister is a 1954 graduate of Dartmouth and received a master’s in business administration from Dartmouth’s Tuck School of Business in 1958. He oversaw the audit office at the college until his retirement; Dartmouth has declined to say in the past when he retired.

McAllister and his wife, Judith, have been named as defendants in at least two lawsuits filed by victims.

It was the lawsuits against the McAllisters that drew the attention of the U.S. Secret Service in Vermont, which helped obtain the single-count indictment.

The lawsuits allege McAllister misappropriated $230,000 from the fraternity and up to $120,000 from the Meccawe Club, the Valley News, a daily newspaper in West Lebanon, N.H., has reported.

McAllister was dismissed as treasurer from both organizations, the News said. The paper reported McAllister had told fraternity leaders they had $233,000 in the bank, but financial records showed the amount actually was $98.92.

The lawsuits, which are pending in state courts, allege McAllister wrote checks to himself, his wife and a small sawmill company that he operated from his backyard, Sugartop Sawmill.

McAllister has been free on court-imposed conditions since November, when he pleaded not guilty. At that time, Magistrate Judge John Conroy noted McAllister suffers from a “serious medical history,” and prosecutors did not object to his release.

McAllister’s medical condition has not been made public, and on Wednesday he carried a small oxygen tank with him to the defendant’s table, as he did for his November arraignment.

The misappropriated money went for McAllister’s use or for the benefit of other organizations, the indictment stated.

Representatives of both the Dartmouth fraternity and the trout club attended Wednesday’s hearing but did not address the court.